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IN THE DISTRICT COURT OF THE UNITED STATES FOR THE
MIDDLE DISTRICT OF ALABAMA, NORTHERN DIVISION
CAMELLIA THERAPEUTIC )FOSTER AGENCY, LLC, )
)Plaintiff, )
) CIVIL ACTION NO.v. ) 2:06cv735-MHT
) (WO) THE ALABAMA DEPARTMENT )OF HUMAN RESOURCES, )
)Defendant. )
OPINION
Plaintiff Camellia Therapeutic Foster Care Agency,
LLC, a private agency, brings this lawsuit against
defendant Alabama Department of Human Resources pursuant
to Title VI of the Civil Rights Act of 1964, 42 U.S.C.
§§ 2000d et seq., for racial discrimination in the
awarding of foster-care contracts to private agencies.
Camellia also asserts a violation of its right to
procedural due process under the Fourteenth Amendment as
well as state claims of interference with an existing
lawful business and interference with contractual
relations. Jurisdiction over Camellia’s federal claims
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1. The department actually filed a motion to dismissand an alternative motion for summary judgment. Becausethe parties have submitted materials outside thepleadings and the court has considered such materials,the court is considering only the department’s motionfor summary judgment. See Concordia v. Bendekovic, 693F.2d 1073, 1075 (11th Cir. 1982); Kachler v. Taylor, 849F.Supp. 1503, 1507 n. 3 (M.D. Ala. 1994) (Thompson, J.).The dismissal motion will be denied as moot.
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is proper under 28 U.S.C. § 1331 (federal question) and
28 U.S.C. § 1343 (civil rights); jurisdiction over its
state claims is proper under 28 U.S.C. § 1367
(supplemental jurisdiction).
This case is currently before the court on the
department’s motion for summary judgment.1 Summary
judgment will be entered in favor of the department and
against Camellia.
I. SUMMARY-JUDGMENT STANDARD
Summary judgment is appropriate “if the pleadings,
depositions, answers to interrogatories, and admissions
on file, together with the affidavits, if any, show that
there is no genuine issue as to any material fact and
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that the moving party is entitled to a judgment as a
matter of law.” Fed. R. Civ. P. 56(c). Under Rule 56,
the party seeking summary judgment must first inform the
court of the basis for the motion, at which point the
burden then shifts to the non-moving party to demonstrate
why summary judgment would not be proper. Celotex Corp.
v. Catrett, 477 U.S. 317, 323 (1986); see also
Fitzpatrick v. City of Atlanta, 2 F.3d 1112, 1115-17
(11th Cir. 1993) (discussing burden-shifting under Rule
56). The non-moving party must affirmatively set forth
specific facts showing a genuine issue for trial and may
not rest upon the mere allegations or denials in the
pleadings. Fed. R. Civ. P. 56(e).
The court’s role at the summary-judgment stage is not
to weigh the evidence or to determine the truth of the
matter, but rather to determine only whether a genuine
issue exists for trial. Anderson v. Liberty Lobby, Inc.,
477 U.S. 242, 249 (1986). In doing so, the court must
view the evidence in the light most favorable to the non-
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moving party and draw all reasonable inferences in favor
of that party. Matsushita Elec. Indus. Co. v. Zenith
Radio Corp., 475 U.S. 574, 587 (1986).
II. FACTUAL BACKGROUND
Camellia began accepting foster children in 2002.
Joseph Appiah, who is of African descent and who is the
private agency’s chair and chief executive officer,
recruited and trained foster-care parents and confirmed
that all foster parents were licensed.
In May 2004, the Human Resources Department’s
Resource Development Director asked Appiah to attend a
meeting in his office. The director advised Appiah that
his private agency was growing too fast and that he was
concerned that not all of Camellia’s parents were
licensed; the director also informed Appiah that foster
parents were coming to Camellia because it paid more
money than the State required. Appiah denied the two
allegations.
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Between May and June 2004, 30 children were removed
from foster homes under the supervision of Camellia. In
July 2004, Appiah received a letter from the Commissioner
of the Department of Human Resources, stating that there
were foster parents within his private agency that had
not been cleared by the Federal Bureau of Investigation
(FBI) or the Alabama Bureau of Investigation (ABI).
Appiah denied this allegation and submitted copies of all
documentation proving that his foster parents had been
cleared by the FBI and ABI and approved by the
department.
In August 2004, the department sent staff to
Camellia’s offices to audit its records. After a
thorough check of all the records, the department
determined that Camellia was in full compliance with all
requirements. Nonetheless, the department continued to
conduct numerous spontaneous audits and took over the
responsibility of completing intake evaluations on all
children entering Camellia.
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In February 2005, the department issued requests for
proposals (RFPs) to Camellia and other private foster-
care agencies. An RFP is an invitation for qualified
vendors to submit a response or to offer their services
to the state based on the requirements of the document.
Appiah submitted a response in a timely manner on behalf
of Camellia.
Five evaluators individually scored at least 13 RFPs
over a two-day period. The scores were averaged for a
final score that was then given to each private agency
that had submitted a proposal. An agency whose proposal
scored below 800 would not be awarded a contract.
Camellia scored 753.3 and did not receive any
contracts from the department. The scores Camellia
received from the five evaluators varied widely: 932.5,
887.5, 769, 682.5, and 495. The lowest score, 495, was
given by Joyce Wilson.
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2. Camellia asserts, on the basis of Appiah’sunderstanding without any additional evidence, that theDepartment of Human Resources did not want to award acontract to Seeraj, but did so after members of the“NAACP/Black Caucus” intervened. See Brief in Oppositionto the Summary Judgment Motion at 13 (doc. no. 40).
3. Notice of Information Requested at PretrialConference (Doc. No. 46).
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Seeraj, the only other African-American owned agency
to submit an RFP proposal,2 received a final score of
854.5 and was awarded contracts from the department.3
In 2006, Appiah submitted two additional RFP
proposals to the department, and Camellia was again
denied contracts because of its low score. Specifically,
Appiah responded to an RFP for Foster Care Recruitment
Services in Mobile and Jefferson Counties. Camellia
alleges that it was the only private agency that had the
facility and staff in these counties to offer foster-care
and therapeutic services. Nonetheless, the department
offered one of the contracts to another agency that
allegedly had no staff to perform the services, and it
cancelled the second contract offer. As a result of the
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contract denials, Camellia was forced to close all but
one of its offices and alleges that it has suffered
financially.
III. DISCUSSION
A. Eleventh Amendment Sovereign Immunity
The Alabama Department of Human Resources contends
that the claim against it under Title VI must be
dismissed because it is immune from suit pursuant to the
Eleventh Amendment to the United States Constitution.
That amendment prevents a federal court from exercising
jurisdiction over a lawsuit against a State and its
agencies, unless that State either has consented to be
sued or has waived its immunity from suit. Pennhurst
State School and Hospital v. Halderman, 465 U.S. 89, 98-
100 (1984). According to federal statute,
“A State shall not be immune under theEleventh Amendment of the Constitutionof the United States from suit inFederal Court for a violation of ...title VI of the Civil Rights Act of 1964[42 U.S.C. § 2000d et seq]., or the
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provisions of any other Federal statuteprohibiting discrimination by recipientsof Federal financial assistance.”
42 U.S.C. § 2000d-7; see also Garrett v. Univ. of Alabama
at Birmingham Bd. of Trustees, 344 F.3d 1288, 1290-91
(11th Cir. 2003). The Eleventh Circuit Court of Appeals
has interpreted this statute to manifest an “unmistakable
intent to condition federal funds [under Title VI] on a
state’s waiver of sovereign immunity.” Sandoval v.
Hagan, 197 F.3d 484, 493 (11th Cir. 1999), overruled on
other grounds, Alexander v. Sandoval, 532 U.S. 275
(2001). Therefore, the department, by receiving Title VI
federal funds, has waived its sovereign immunity under
the Eleventh Amendment.
B. Title VI
The Department of Human Resources next contends that
it is entitled to summary judgment on Camellia’s Title VI
claim because the foster agency has failed to produce
sufficient evidence of intentional discrimination to
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survive summary judgment. Camellia responds that it need
only show that the department’s conduct had an
unjustified discriminatory effect under Title VI.
Title VI has two main parts. First, § 601 states
that no person shall, “‘on the ground of race, color, or
national origin, be excluded from participation in, be
denied the benefits of, or be subjected to discrimination
under any program or activity’ covered by Title VI.”
Sandoval, 532 U.S. at 278 (quoting 42 U.S.C. § 2000d).
Private individuals may sue to enforce § 601; however,
the provision prohibits only intentional discrimination.
Id. at 279-80.
Second, § 602 “authorizes federal agencies ‘to
effectuate the provisions of § 601 ... by issuing rules,
regulations, or orders of general applicability.’” Id.
at 278 (quoting 42 U.S.C. § 2000d). This provision
“proscribe[s] activities that have a disparate impact on
racial groups.” Id. at 281. However, there is no
private right of action to enforce § 602. Id. at 293.
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Camellia, as a private actor, can sue to enforce only
§ 601, which, as stated, requires proof of intentional
discrimination. Because Camellia seeks to produce
circumstantial evidence of intentional discrimination,
this court will address its Title VI claim under the
familiar McConnell Douglas burden-shifting framework.
McDonnell Douglas Corp. v. Green, 411 U.S. 792 (1973);
see also Brown v. American Honda Motor Co., 939 F.2d 946,
958-59 (11th Cir. 1991).
Under the McDonnell Douglas framework, the plaintiff
has the initial burden of establishing a prima-facie case
of unlawful discrimination by a preponderance of the
evidence. McDonnell Douglas, 411 U.S. at 802; Damon v.
Fleming Supermarkets of Florida, Inc., 196 F.3d 1354,
1358 (11th Cir. 1999). If the plaintiff establishes a
prima-facie case, the burden then shifts to the defendant
to rebut the presumption by articulating legitimate, non-
discriminatory reasons for its action. Chapman v. AI
Transport, 229 F.3d 1012, 1024 (11th Cir. 2000). The
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defendant has the burden of production, not of
persuasion, and thus does not have to persuade a court
that it was actually motivated by the reasons advanced.
Texas Dep’t of Cmty. Affairs v. Burdine, 450 U.S. 248,
253-55, 258 (1981); McDonnell Douglas, 411 U.S. at 802.
Once the defendant satisfies this burden of
production, the presumption of discrimination falls away
and the plaintiff has the opportunity to come forward
with evidence, including the previously produced evidence
establishing a prima-facie case, sufficient to permit a
reasonable factfinder to conclude that the reasons given
by the defendant were not the real reasons for the
adverse decision. Chapman, 229 F.3d at 1024. The
plaintiff may meet this burden by persuading the court
that a discriminatory reason more than likely motivated
the defendant or by demonstrating that the proffered
reason for the adverse decision is not worthy of belief.
Burdine, 450 U.S. at 256.
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PRIMA-FACIE CASE: Camellia may establish a prima-
facie case of discrimination in the awarding of foster-
care contracts by showing that (1) it is within the
protected class; (2) it was qualified to receive a
contract; (3) its proposal for a contract was rejected;
and (4) the department awarded contracts to non-members
of the class with similar qualifications. See Oti Kaga,
Inc. v. South Dakota Housing Dev. Auth., 342 F.3d 871,
882-83 (8th Cir. 2003). The court will assume that
Camellia has established a prima-facie case.
LEGITIMATE, NON-DISCRIMINATORY REASON: Since the
court assumes that Camellia has established a prima-facie
case, the burden of production shifts to the Department
of Human Resources to rebut the presumption by
articulating a legitimate, non-discriminatory reason for
its failure to award a contract to Camellia.
The department explains that the reason Camellia was
not awarded a contract was because it received an RFP
score of 753.3, which was below the 800 required to be
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awarded a foster-care contract. The department has met
its burden of production.
PRETEXT: At the final stage of the McConnell Douglas
framework, the burden shifts back to Camellia which must
come forward with evidence sufficient to permit a
reasonable fact finder to conclude that the legitimate
reason given by the Human Resources Department is not its
true reason but is a pretext for discrimination. See
Vessels v. Atlanta Indep. School Sys., 408 F.3d 763, 771
(11th Cir. 2005).
Camellia contends that the department’s reason for
not awarding it a contract is pretextual because the
scoring process was tainted by the discrimination of one
particular scorer, Joyce Wilson. As shown, Wilson gave
Camellia a score of 495, which was significantly lower
than those of the other four evaluators, who gave
Camellia scores of 682.5, 769, 887.5 and 932.5. The
department contends that Wilson was a universally hard
scorer, but that is not borne out in the data; of the 14
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agencies she scored, Camellia’s score was the lowest. In
fact, Wilson gave two other agencies scores below the
qualifying score of 800, Ability Plus, Inc., which
received a score of 545, and Families in Transition,
which received a score of 782.5. However, more
significantly, the data also show that the two other
private agencies Wilson gave her below-800 scores to,
Ability Plus and Families in Transition, were both white-
owned. In addition, Wilson gave the only other African-
American owned agency, Seeraj, a score above 800, that
is, 813.75. These scoring data, therefore, do support a
finding of racial discrimination.
Finally, and perhaps more importantly, Camellia has
presented no evidence demonstrating that Wilson knew the
race of the owners of the individual agencies at the time
she scored the RFPs; nor has Camellia presented evidence
from which a factfinder could assess and reasonably
conclude that a white-owned private agency comparable in
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all relevant respects to Camellia was rated differently
by Wilson.
The evidence is, thus, not sufficient to raise a
genuine issue of material fact that race discrimination
more than likely motivated the department in the awarding
of foster-care contracts or that the department’s
articulated reason is unworthy of belief. The Alabama
Department of Human Resources is therefore entitled to
summary judgment on Camellia’s Title VI claim.
C. Procedural Due Process
The Alabama Department of Human Resources next
contends that Camellia has failed to present sufficient
evidence to survive summary judgment on its procedural
due-process claim. Camellia asserts, without explanation
or citation, that it was entitled to a hearing pursuant
to Title VI. Because there is no right to a hearing in
the express language of Title VI, the procedural due-
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process claim must be addressed under the Fourteenth
Amendment.
Deprivations of interests in life, liberty and
property are subject to the requirements of procedural
due process. Board of Regents of State Colleges v. Roth,
408 U.S. 564, 569 (1972). To prove a denial of procedural
due process, Camellia must establish: “(1) a
constitutionally protected interest in life, liberty or
property; (2) governmental deprivation of that interest;
and (3) the constitutional inadequacy of procedures
accompanying that deprivation.” Bank of Jackson County
v. Cherry, 980 F.2d 1354, 1357 (11th Cir. 1992). The
sole issue is whether Camellia had a property interest in
being awarded the government contract.
“To have a property interest in a benefit, [a private
agency] ... must have more than an abstract need or
desire for it. [It] must have more than a unilateral
expectation of it. [It] must, instead, have a legitimate
claim of entitlement to it.” Roth, 408 U.S. at 577.
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4. The Eleventh Circuit has only cited with approvalthe holding of the Federal Circuit Court of Appeals thata contractor has no property interest in governmentcontracts. Bank of Jackson County, 980 F.2d at 1357(citing ATL, Inc. v. United States, 736 F.2d 677, 683(Fed. Cir. 1984)).
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Such property interests “are created and their dimensions
are defined by existing rules or understandings that stem
from an independent source such as state-law rules or
understandings that secure certain benefits and that
support claims of entitlement to those benefits.” Id.
The Eleventh Circuit has not specifically addressed
whether a bidder has a property interest in a government
contract.4 However, the Sixth Circuit Court of Appeals
has established a standard for determining whether a
bidder has a constitutionally protected property interest
in a publicly bid contract that this court finds
persuasive. The appellate court explained that
constitutionally protected property in a government
contract can be demonstrated in two ways. “A bidder can
either show that it actually was awarded the contract and
then deprived of it, or that, under state law, the
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[government entity] had limited discretion, which it
abused, in awarding the contract.” Club Italia Soccer &
Sports Org., Inc. v. Charter Township of Shelby, Mich.,
470 F.3d 286, 297 (6th Cir. 2006). In is clear from the
record that Camellia is unable to make either of the
requisite showings. Camellia does not argue that it was
actually awarded a contract; in fact, it argues the
contrary. Further, the only limitation on the Human
Resources Department’s awarding of contracts was that
private foster-care agencies receive an RFP score of
above 800. There is no evidence in the record that the
department abused this discretion by awarding contracts
to private agencies that received scores below 800.
Therefore, the department is entitled to summary judgment
on Camellia’s procedural due-process claim.
D. State Claims
SUPPLEMENTAL JURISDICTION: Camellia raises two state
claims: interference with an existing lawful business and
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interference with contract relations. The Department of
Human Resources contends that this court should decline
to exercise supplemental jurisdiction over these claims.
A district court has discretion to decline
supplemental jurisdiction over a claim when it “has
dismissed all claims over which it has original
jurisdiction.” 28 U.S.C. § 1367(c)(3). Factors to be
taken into account include “the values of judicial
economy, convenience, fairness, and comity.” Carnegie-
Mellon Univ. v. Cohill, 484 U.S. 343, 350 (1988). Courts
are strongly encouraged to dismiss state claims when the
federal claims have been dismissed prior to trial. See
id. (“federal court[s] should decline the exercise of
[supplemental] jurisdiction by dismissing the case
without prejudice” when the federal law claims have been
dismissed prior to trial).
This court has dismissed, prior to trial, all the
federal claims for which it had original jurisdiction.
However, this court will take into consideration whether
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the state claims can be brought in state court.
Ordinarily, the period of limitations for dismissed state
claims filed in federal court pursuant to 28 U.S.C.
§ 1367 is “tolled while the claim is pending and for a
period of 30 days after it is dismissed unless state law
provides for a longer tolling period.” 28 U.S.C.
§ 1367(d). However, the Supreme Court has held that the
tolling provision of § 1367(d) is unconstitutional when
applied “to claims against nonconsenting state
defendants.” Raygor v. Regents of Univ. of Minnesota,
533 U.S. 534, 542 (2002). Because the Department of
Human Resources is a nonconsenting state defendant,
§ 1367(d)’s tolling provision does not apply to it, and
this court must turn to, and rely on only, state law.
According to Alabama law, Camellia had two years from
the date of the injury to file its state claims in state
court. See 1975 Ala. Code § 6-2-38(l) (“All actions for
injury to the person or rights of another not arising
from contract and not specifically enumerated in this
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section must be brought within two years.”). Because the
injury arose in this action on or about May 12, 2005,
when the department published on its website a “Notice of
Intent to Award Contracts” and disclosed that Camellia
scored below the minimum of 800 for the awarding of
foster-care contracts, Camellia’s state claims are barred
under state law. Therefore, if this court were to
dismiss Camellia’s state claims, Camellia would not be
able to file the claims in state court because the claims
would not have been tolled by § 1367(d) and therefore
would be late. Thus, out of considerations of fairness
to the parties, this court will exercise supplemental
jurisdiction over Camellia’s state claims.
INTERFERENCE WITH BUSINESS OR CONTRACTUAL RELATIONS:
Camellia contends that the Department of Human Resources
intentionally interfered with its lawful business and
contractual relations by discriminating against it in the
awarding of foster-care contracts. “The tort of
intentional interference with business or contractual
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relations requires: (1) the existence of a contract or
business relation; (2) [d]efendant’s knowledge of the
contract or business relation; (3) [i]ntentional
interference by the defendant with the contract or
business relation; (4) [a]bsence of justification for the
defendant’s interference; and (5) [d]amage to the
plaintiff as a result of defendant’s interference.”
Folmar & Assocs. LLP v. Holberg, 776 So.2d 112, 115 (Ala.
2000) (citation omitted). However, “a party to a
contract or a business relationship cannot be liable for
tortious interference with that contract or business
relationship.” Waddell & Reed, Inc. v. United Investors
Life Ins. Co., 875 So.2d 1143, 1154 (Ala. 2003). Since
the department, as Camellia would have it, was a party to
the contract and business relationship with it, the
department cannot be held liable for tortious
interference.
Therefore, this court holds that the Human Resources
Department is entitled to summary judgment on the claims
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of interference with a lawful existing business and
interference with contractual relations.
IV. CONCLUSION
For the foregoing reasons, the Alabama Department of
Human Resources’s motion for summary judgment will be
granted on Camellia’s federal and state claims.
An appropriate judgment will be entered.
DONE, this the 5th day of November, 2007.
/s/ Myron H. Thompson UNITED STATES DISTRICT JUDGE
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